(Toronto) Canadian ride-sharing and food delivery company Uber will move from the Netherlands to Canada, a change that will affect the company’s tax bill.
The San Francisco, California-based tech giant said the change to its Canadian operations will take effect on January 1.he is July and will be required to collect sales taxes that will be transferred to governments.
Uber made it clear that the change would not result in new fees for most restaurants, drivers or carriers, but that existing fees would now be subject to federal Goods and Services Tax (GST), regional sales taxes and Harmonized Sales Tax (HST). Uber Eats pass subscribers may also have to pay sales tax.
This change will allow restaurants, drivers and delivery companies to claim tax breaks, and will require all of their users, including passengers, restaurant diners, drivers and couriers, to sign agreements with the new Canadian Uber entities.
The company said it has been preparing to relocate its Canadian operations since 2018 and has already taken similar steps in regions of Australia – New Zealand, Europe, the Middle East and the United States.
Uber began considering the move after Ontario Uber Eats driver David Heller filed a class action lawsuit against the company in 2017.
Heller had hoped that Uber would recognize drivers as employees and provide them with minimum wages, vacation allowances and other protections under the Ontario Employment Standards Act.
Uber defended itself and got suspended because it had a contractual clause obligating all of its disputes to go to mediation in the Netherlands, where the company was founded.
The case has been taken to the Supreme Court of Canada, which sided with drivers in 2020 and paved the way for a class action lawsuit for certification.
Uber eventually changed its dispute resolution protocols to allow arbitration in the province or territory the driver resides, but employment attorney Samara Beletsky said the new Uber agreements still contain legal clauses that could upset unsuspecting drivers.
Me Belitzky, which is part of Samfiru Tumarkin LLP that is leading the class action, noted that new contracts sent to drivers require them to agree not to participate in class actions against Uber — a clause that was also in their previous agreement.
Uber wants drivers to agree to resolve their issues through arbitration or on an individual basis, but it also provides instructions on how to opt out of this clause, Mr.e Belitsky.
“The opt-out information is only at the end […] It’s written in heavy legal language, so most Uber drivers don’t even see them.”e Belitsky.
They do not realize that their rights are affected. ”
She recommends that anyone requesting to sign the new agreement read it carefully.
The company, which began alerting its users about the changes on Wednesday, also offers tax helplines and resources for anyone with questions.